As Business Intelligence reports, John Chambers, long-time CEO of Cisco, recently told attendees at the Fortune Brainstorm conference in Aspen:
On the one hand, he hints that Cisco might carry more fat on its payroll than it should, but that he “doesn’t have the heart” to implement some kind of brutal, competitive HR practice, like a stack ranking performance review, where employees are rated against each other and the bottom percent are let go.
“A well-run organizations turns over 10% of their organizations, including senior leadership. I don’t have the heart to do that.
Arrrgh! Either Einheit is important or it isn’t. If it isn’t, then a “stack ranking performance review” is a wonderful way to kill it. Deming pointed this out in Out of the Crisis and it’s embodied in his 14 points. He was right then, and he’s still right.
Stick with your instincts, John.